In an entertaining but astute article in , The Financial Times Weekend Magazine, David Gaffney offers a trawl through some dos and don’ts and a couple of misconceptions.
He has written a novel Never Never based on this, and as you would therefore expect, he has a keen ‘eye’.
First he cautions against the ‘all the eggs in one basket’ approach to controlling spiralling debt. And warns not to borrow one’s way out of trouble. Perhaps he should have a word with Dear Gordon?
When you owe a lot, some arrangements can involve very tiny paybacks, and ‘geological’ payback periods. Gaffney says the first time he explained this to a client it was not well received! His bedside manner has improved.
Bailiffs seem a tricky area, but the main rule is not to let them in! Though of course the court-appointed bailiff is a different matter. Once in they are entitled to take inventory and return for collection of those goods.
He points out that creditors are keen to move as much of your money to them as they can possibly argue you should, while your task must be to hold on to all the money you need to live decently. And that – as a debt counsellor – he had no principles about his attitude to them. they will survive, and so must you, the debtor!
While he has some understanding of borrowing from one card to pay off others he says it is hard work and maybe it is a lot easier to stop. Strangely he found most multiple debtors were jolly, not my understanding at all. While bankruptcy costs.
He has several warnings about ways to avoid debt, such as being careful who you buy Christmas hampers from and ways of saving money on electricity.
Let me say he is a very witty writer and his explanation of the way judge’s are sympathetic to debtors is a good example, including that it might not be a good idea to wear clothes which are part of the original debts before the court.
He points out that credit companies want you to owe them money, which is their business after all. It is the paying back bit that can get complicated. And hire purchase goods cannot be taken back! Let me add that it is not a good idea to do this deliberately.
Among his clients have obviously been some ‘professional debtors’ since he suggests never being available to creditors or their agents since if they are unable to contact you for six years the debt lapses. Though the rule is not absolute, and would apply only to non-priority debts. (there are very few priority debts which include revenue taxes, council tax, rent, mortgage and utility services payments, and not much else)
But if you own your house his no 16 is ‘You can lose your house if you don’t pay’. Be warned! As I always emphasise being honest is the best approach.
One thing is very important. One that I have seen rarely mentioned. ‘Beware,’ he says clearly, ‘those creditors who sent measured and polite threats.’ Because they probably mean it.
It is possible to end up with someone else’s debts, so don’t accept delivery of something you don’t know about. It may carry a big burden of someone else’s unpaid debts.
He ends on a note of grim faced humour…
’20 Life is beyond some people’s means
‘A debtor is someone who hasn’t got enough money for the lifestyle he or she chooses. Most frequently this is a lifestyle most people call normal life – like having a phone, a telly, some clothes, heating the house and running the water. What should we do, kill them all?’
Joseph Harris
Debt Control Man
Control Your Debt Crisis 